China's economic growth picked up slightly in the first quarter driven by strong performances from the export, manufacturing and services sectors, with the ruling-Communist Party saying Tuesday that the preliminary results "continued the good momentum" of the country's rebound from COVID-19. File Photo by Mark R. Cristino/EPA-EFE
April 16 (UPI) -- China's economic growth picked up slightly in the first quarter driven by strong performances from the export, manufacturing and services sectors, with the ruling-Communist Party saying Tuesday that the preliminary results "continued the good momentum" of the rebound of the country's economy from COVID-19.
Annual GDP growth came in at 5.3% in the January to March period, up from 5.2% in the fourth quarter, and 1.6% on a quarterly basis, 0.4% higher than in October to December, helped by "positive factors amassing, laying a strong foundation for achieving annual development targets," the National Bureau of Statistics said in a news release.
However, the bureau pointed to an external environment it said was becoming increasingly complex, problematic and unsettled, warning that the "foundation for stable and sound economic growth is not solid yet."
Annual retail sales growth came in at a lower-than-anticipated 3.1% while industrial output measured by producers' prices in March was up by 4.5%, but short of the 6% growth expected, and the country's troubled real estate sector exhibited ongoing weakness with annual investment plunging 9.5% in the January to March quarter.
In late January, China Evergrande Group, one of the country's most high-profile developers, was placed into liquidation by a court in Hong Kong after repeatedly failing to come up with a viable plan to restructure liabilities of at least $325 billion, sending shockwaves through the sector.
Nevertheless, strong demand from the rest of the world for Chinese-made goods delivered a $180 billion trade surplus for the quarter on the back of a 14% jump in export volumes compared with the same period in 2023.
Together with generally solid growth numbers, the export performance would provide the government with a measure of reassurance that it is on track with the economic and monetary policies it is pursuing, Zhiwei Zhang, president and chief economist of Pinpoint Asset Management in Hong Kong wrote in a note to clients.
"With the Fed rate cut probability declining, I think the chance of a rate cut by the People's Bank of China is also diminishing," he warned.
China's $17.8 trillion economy is the world's second largest after the United States with years of double-digit GDP growth helping the country leapfrog the major European economies one by one, before eventually wresting the number two spot from Japan in 2010.
